We live – according to some sociologists – in an era of multiple crises, where multiple, interconnected and mutually reinforcing crises pose a challenge to our way of life. They talk about a world zigzagging from one crisis to another: the pandemic, the energy shock, the wars in Ukraine and the Middle East, rising geopolitical tensions and financial fragility.
And of course the mother of all existential threats, climate change.
Perhaps the most surprising thing about the past four years, when these threats and crises have dominated, is the resilience of the economy. Ireland’s macroeconomic performance is a clear example of this. Despite threats and setbacks (we can also include Brexit), the 2019-23 era will be the strongest period of employment growth in the country’s history.
During those years, 350,000 new jobs were created, taking total employment in the Irish economy to an all-time high of 2.6 million in 2023, according to the Central Statistics Office’s latest ‘Year in Figures’ release.
The employment rate reached 74.2 percent in the second quarter of 2023, the highest point since the start of the current series 25 years ago.
2023 also saw a rapid decline in headline inflation, the main macroeconomic threat, with price growth falling to 3.9 percent in November, the lowest rate on record in more than two years, and down from a high of 8.5 percent in February and 2023. Peak of 9.2 percent in October 2022.
There are undoubtedly problems, particularly housing problems, which are now the main driver of intergenerational inequality in Ireland. The median price or mid-point price of a house has risen steadily over the year from €305,000 in January to €323,000 in October 2023, the last month for which data is available, which is far beyond the means of many. People with good incomes.
[ Gerard Howlin: https://www.irishtimes.com/opinion/2024/01/05/gerard-howlin-the-young-are-caught-in-a-grotesquely-unfair-trap/ ]
Almost full employment, combined with abundant tax revenues from the multinational sector, has insulated the economy and avoided the kind of reversal we saw in 2010. The challenge now is to use these resources to meet our immediate priorities.